3 Ways AI Can Transform Financial Services
From managing money to comparing insurance products, consumers want to access products, services and advice quickly and easily – from anywhere and on any device.
As a result of this ‘need for speed’, companies, big and small, have been developing technologies to speed up and smooth out the end-to-end customer experiences for financial services and insurance (FSI).
Artificial intelligence (AI) is key in this space, with machine learning enabling everything from automated saving and investing to speedy customer service. Despite this, traditional banks have been slow to adopt these new technologies, leaving them lagging in customer experience. In this article, we’ll explore 3 ways AI-powered tech can help FSI businesses enhance their customer journeys.
1. Increased personalisation
Research shows that personalisation is the key to customer retention. This is because personalisation (in both communication and product offering) increases engagement – and engaged customers are more likely to buy products or services. In fact, 80% of people are more likely to purchase from a company that offers personalised experiences. And when it comes to FSI, engaged customers stay loyal for up to 4 years longer than unengaged ones.
Banks can use AI-enabled technology to offer smarter recommendations based on people’s previous interactions. These digital solutions can also analyse consumer engagement to pick the best time to offer products, increasing the likelihood of up-selling and cross-selling. By using AI, banks can use their wealth of customer information to tailor every communication and every offer, maximising conversion rates and demonstrating to consumers that they’re more than just another number.
2. Faster decision making
Financial products and services hinge on credit and background checks, which can be time-consuming to carry out. These slow processes can frustrate customers and increase drop-out rates.With AI, FSI businesses can automate key decision-making processes and cut down on wasted time. AI solutions allow lenders to make smarter underwriting decisions based on a wide range of factors – and make these decisions much faster. Whether it’s giving customers an automatically calculated chance of approval, quickly assessing premiums based on risk factors, or granting instant approval to existing customers who meet criteria – AI makes it much easier for customers to take out financial products.
3. Improved security
FSI is tightly regulated, which means security is paramount. Not only can a breach lead to hefty fines, but it can also erode trust, which can be a death sentence. Because of this, traditional banks have typically relied on seeing physical proof of identification when people open accounts, withdraw or transfer large sums of money, or take out insurance products. But this approach simply isn’t suited to our modern lifestyle. Customers have neither the time nor inclination to walk into a branch with multiple copies of old utility bills. And even if they did, Covid has meant many physical locations are unavailable.
The good news is that security in the digital world is robust. Two-factor authentication and biometric recognition are quick and easy ways for banks to enforce security and speed up digital identification and verification (ID&V) processes. Biometrics are essentially impossible to forge, and two-factor authentication adds an extra security layer, giving businesses and customers alike peace of mind.
This AI image recognition technology can also be used to verify digitally uploaded documents, speeding up the customer experience without compromising security.
AI is increasingly integral to the world we live in, and the finance industry needs to implement these technologies to stay relevant and meet customers’ high expectations. Fortunately, despite a slow start, most banks recognise this need to modernise. 80% acknowledge the benefits of AI, 46% plan to implement it in the near future. Success then hinges on a holistic implementation approach, with banks focusing on joined-up processes and data.
To learn more about implementing AI, download Engage Hub’s whitepaper on balancing customer trust and security while using AI to improve customer experience.
About Engage Hub:
Every customer is unique. Engage each one.
At Engage Hub, it’s our mission to make sure your business treats your customers as individuals to engage each and every one, so you win them over faster and keep them for longer.
With over 30 years in the business, our services have evolved alongside the needs of our clients, including some of the world’s most successful brands across the financial services, utilities, telecoms, retail and logistics sectors. We understand the challenges you face – from data silos to legacy systems – and have built intelligent, intuitive and effective solutions that work for you.
Our commitment to excellence has helped us build a reputation as the leading global provider of data-driven consumer engagement and customer retention solutions. At a time when brand loyalty is at an all-time low, our data orchestration technology delivers the kind of experiences your customers have now come to expect. So, you can always keep them engaged and happy.
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